DENVER (BRAIN) — Samuel J. Mancini, who was arrested last July for securities fraud and other civil and criminal charges related to a plan to invest in cycling companies, is close to a plea deal with prosecutors on criminal charges, according to court documents.
Prosecutors charge that Mancini, the managing director of Outdoor Capital Partners, raised over $11 million from about 40 investors in a plan to acquire De Rosa Cycles, De Marchi Apparel, Limar Helmets and Gruppo Srl, the parent of Cinelli and Columbus. None of the acquisitions were completed. The Securities and Exchange Commission and the U.S. Attorney's Office for New Jersey said Mancini and OCP misappropriated about $400,000 of investor money and made $800,000 in "Ponzi-like" payments to the investors, some of whom were demanding their money back before the arrest.
Mancini was arrested in Denver on July 26 and was released on a $100,000 bond the same day. The SEC had obtained a court order to freeze his and the company's bank accounts before the arrest.
The U.S. Attorney’s Office for the District of New Jersey charged Mancini with criminal charges including securities fraud, wire fraud, and money laundering, while in a separate civil case, the Securities and Exchange Commission charged him with securities law violations. Both cases are filed in New Jersey because at least one of the investors lives there.
On Monday lawyers for both sides asked the judge in the civil case to issue an order for continuance until the end of the criminal case. They said Mancini has signed a plea agreement in the criminal case but a hearing where he would change his plea has not been scheduled. Attorneys said they expect a contested sentencing hearing to be held 90 to 120 days after the plea hearing. Without the continuance, Mancini is required to answer charges in the civil case on Feb. 1. Mancini is asking the court to push out that deadline to May 2.
UPDATE: Magistrate Judge Michael A. Hammer issued the continuation on Jan. 25; discovery has been stayed and the deadline for Mancini's response is now May 2. The judge in the criminal case has also issued an order to continue while a plea hearing is scheduled.
For the criminal charges, a securities fraud count carries a maximum of 20 years in prison and a $5 million fine. Each of two counts of wire fraud are punishable by a maximum of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest. The count of money laundering is punishable by a maximum of 10 years imprisonment and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest, according to the U.S Attorneys Office.
In the civil case, the SEC is asking for disgorgement of ill-gotten gains with interest and civil penalties. The SEC also is seeking to bar Mancini from serving as an officer or director of any public company.
